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SAN FRANCISCO, CA - SEPTEMBER 12: (L-R) Apple CEO Tim Cook, Apple senior vice president of Industrial Design Jonathan Ive and Dave Grohl of the Foo Fighters look on as an attendee looks at the new iPhone 5

For a while some Apple gurus have been advocating that Apple should fire its CEO Tim Cook and replace him with Jonathan Ive. As Apple stock plunges, the buzz is spreading.

On the surface, the buzz makes sense. From the top at $705, Apple stock has lost about $210 billion in market cap. It is simply human nature to ask for the head of the top guy.

Jonathan Ive’s attraction to the gurus is obvious. Steve Jobs made Ive in charge of industrial design. Ive worked with Jobs to set Apple apart by producing industrial designs that are minimalistic, clean, and elegant. Under Cook, Ive has gained more responsibility and stature. Adding to his aura is the fact that the Queen of England conferred upon him the title of ‘Sir.'

It does not take much digging to figure out that the gurus are plain wrong, sorely misinformed, and advocating a potentially grave mistake. There are many reasons; here are the five big reasons.

Apple has saturated the developed markets with its products. Apple’s traditional strategy of going for the affluent crowd does not produce large enough numbers in the emerging markets to continue the growth of Apple’s hay days. A change at the top simply will not solve the problem.

It goes without saying that Apple needs to enter a new category such as TV. iTV has been much rumored. However the fact is that smartphones are the biggest market and Apple generates 70% of its profits from phones. There is simply not another market that is as big as phones with the same profit potential. Even the most optimistic estimates for iTV show it contributing less than 10% to Apple profits.

The dynamics of market size are beyond the control of any human being.

Gurus Are Mistaken About The Background Of Jonathan Ive

Ive’s expertise is industrial design. An industrial designer combines art and science to improve ergonomics, usability, and aesthetics. The gurus miss the point that the heart of Apple products is electronics and software. Ive is neither an electronics engineer nor a software architect.

Apple’s Best Bet Is More Mileage From The Supply Chain

Since Apple is hampered by the market size, its best bet is to get more mileage from its supply chain. Cook is perhaps the most accomplished supply chain expert in the world.

When Wall Street was busy feeding Apple stock to the Muppets, analysts were busy raising their Apple targets without regards for the simple fact that there is only so much disposable income in the world for Apple products. The highest target I heard was $1650. When I analyzed this analyst’s reasoning, it was obvious that he did not consider common sense limitations imposed by economics.

To reach the $1650 target, Apple would have needed to sell to 100% of its potential customers and each one of those customers had to spend about $2500 each and every year on Apple products and services. (See: Apple At $1,650 Looking Like A Pipe Dream.) The limitations on Apple detailed in the column just mentioned still stand and no change at the top can change basic economics.

About Me: I am an engineer and nuclear physicist by background. I founded two Inc. 500 companies, and have been involved in over 50 entrepreneurial ventures. I am the chief investment officer at The Arora Report, which publishes four newsletters to help investors profit from change. Write me: Nigam@TheAroraReport.com. Follow me here. Subscribers to The Arora Report are long Apple from $131 and have already taken partial profits on 90% of the position.